can't rent my student houses


S

steph

I can't rent my student houses. I brought them all more than 8 years ago and
hardly owe the bank a penny. I paint them every 3 years, change the carpets
every 5 years and make sure they comply with all the relevent regulations.
This year I'm stuffed. Because

1. Thousands of landlords have borrowed huge amounts of money to "buy to
let"

2. These same landlords borrowed even more money in the belief that if they
do their houses up to a ridiculously high standard the other new landlords
won't do the same.

3. Thousands of students have run up such high debts that the actual amount
of debt that they end up with has no meaning other than being an abstract
figure in their heads. Meaning that when they exceed a debt of about £5000
it makes no difference to them if it goes up to £10000 or £15000. So they
quite happily borrow a pile of money and rent property (property that to
someone who has to borrow to pay the rent should be considered an
overindulgent luxery) that is way beyond their financial means.

4. Is this likely to go on indefinitly? Some people tell me its a
permananet problem. The good news for me is that quite a few people tell me
that if I hang on for a couple of years it should all sort itself out and I
might even be able to buy more houses at a knockdown price.
 
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C

criticaldensity

I can't rent my student houses. I brought them all more than 8 years ago
and hardly owe the bank a penny. I paint them every 3 years, change the
carpets every 5 years and make sure they comply with all the relevent
regulations. This year I'm stuffed. Because
Why not sell them?

cd
 
C

Craig Barns

It sounds like you know what your doing and what the problems are. If you
can't rent your houses then you're not competing properly in the market
place. You either have to drop prices or improve the quality of the house,
eg decorate. Your problems may well be caused by irrational leveraged
investors, but there's no point dwelling on that fact.

I do agree with you on all your points, especially point 3, I was a student
in debt and once it hits a certain level it truns into a numbers game and
you put it out of your mind. So, improve your houses, drop the rent, or
sell them. It's my feeling that we are going to see a major correction to
the housing market, but I suspect it's going to be 5+ years of steadily
declining prices.

Check out page nine of this
http://www.nationwide.co.uk/hpi/historical/CMQPRQ105.pdf the graph entitled
Long term real house prices trends. If you've got any sympathies with
chartists then a long slow decline in the prices of house looks a certanity.
 
R

Richard Faulkner

steph said:
I can't rent my student houses. I brought them all more than 8 years ago and
hardly owe the bank a penny. I paint them every 3 years, change the carpets
every 5 years and make sure they comply with all the relevent regulations.
This year I'm stuffed. Because

1. Thousands of landlords have borrowed huge amounts of money to "buy to
let"

2. These same landlords borrowed even more money in the belief that if they
do their houses up to a ridiculously high standard the other new landlords
won't do the same.
You can compete with these landlords on price because you do not have to
pay much to the bank - this puts you in a bit of a driving seat in the
current market.
3. Thousands of students have run up such high debts that the actual amount
of debt that they end up with has no meaning other than being an abstract
figure in their heads. Meaning that when they exceed a debt of about £5000
it makes no difference to them if it goes up to £10000 or £15000. So they
quite happily borrow a pile of money and rent property (property that to
someone who has to borrow to pay the rent should be considered an
overindulgent luxery) that is way beyond their financial means.
Given that you can compete aggressively on price, you could try to make
your properties "attractive" enough to motivate the students to be
willing and able to pay each terms' rent up front, out of their
grant/loan, (or whatever it is these days). You could also be very
choosy about the tenants you take.
4. Is this likely to go on indefinitly? Some people tell me its a
permananet problem.
It's probably not sustainable, and the market will sort itself out - but
where it will end up is anybodys guess - at least you can weather the
storm better than those with big loans.
The good news for me is that quite a few people tell me
that if I hang on for a couple of years it should all sort itself out and I
might even be able to buy more houses at a knockdown price.
Possibly, but perhaps you should be looking at a different market/area.

Dont forget that, given that some of the costs of an empty house pass to
the tenants as soon as they are let, it can be worth taking quite a bit
less than you really want, just to improve your cashflow.
 
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T

T.

criticaldensity said:
The Capital Gains might be painful...
Oh yeah, I didn't even think of that.

I was thinking that it may not even sell for ages at the "right" price.
Current market conditions would support that?
 
M

mogga

I can't rent my student houses. I brought them all more than 8 years ago and
hardly owe the bank a penny. I paint them every 3 years, change the carpets
every 5 years and make sure they comply with all the relevent regulations.
This year I'm stuffed. Because

1. Thousands of landlords have borrowed huge amounts of money to "buy to
let"

2. These same landlords borrowed even more money in the belief that if they
do their houses up to a ridiculously high standard the other new landlords
won't do the same.

3. Thousands of students have run up such high debts that the actual amount
of debt that they end up with has no meaning other than being an abstract
figure in their heads. Meaning that when they exceed a debt of about £5000
it makes no difference to them if it goes up to £10000 or £15000. So they
quite happily borrow a pile of money and rent property (property that to
someone who has to borrow to pay the rent should be considered an
overindulgent luxery) that is way beyond their financial means.

4. Is this likely to go on indefinitly? Some people tell me its a
permananet problem. The good news for me is that quite a few people tell me
that if I hang on for a couple of years it should all sort itself out and I
might even be able to buy more houses at a knockdown price.
http://www.housepricecrash.co.uk/
Or have you just come from there?
 
M

mo

A lot of my student mates are moving into brand spanking new houses where
rent is only about £70 a week (less than hall in some cases) and they come
with all sorts of things such as en suite bathrooms, balconies, BBQ area
etc.

The main 2 things that will affect their choices are price (if you can hit
£50 you should be golden) and location to the Uni. The closer it is the more
likely people will want to live there.. Indeed my friend just moved back to
halls for his 3rd year so he is just a 2 min walk away from the main campus.

I dont think having massive flashy houses will be a massive factor in their
decision if the alternatives are a lot cheaper and closer to clubs/uni.

Depends on the area as well though I guess.... in major cities it might be
hard to locate near clubs becoz students will go everywhere, whereas here
they are all a walk away from eachother.

Of course your houses have broadband internet access......?
 
D

Derek *

A lot of my student mates are moving into brand spanking new houses where
rent is only about £70 a week (less than hall in some cases) and they come
with all sorts of things such as en suite bathrooms, balconies, BBQ area
etc.
In Leeds we have brand new privately built tower block "Halls" with
en-suites going for £59.95. Within walking distance of Uni. Poli. and
Park Lane College.
The main 2 things that will affect their choices are price (if you can hit
£50 you should be golden) and location to the Uni. The closer it is the more
likely people will want to live there.. Indeed my friend just moved back to
halls for his 3rd year so he is just a 2 min walk away from the main campus.
Easy to save £2.00/day by being able to walk.
I dont think having massive flashy houses will be a massive factor in their
decision if the alternatives are a lot cheaper and closer to clubs/uni.
10/12 years ago our 2 eldest stayed in unbelievably squalid student lets
(decoration and fittings from the1950's). I'm sure it was a factor in
the youngest one not signing up for the 3rd year that would have turned
his HND into a degree.

His younger sister who's away at Uni now just wouldn't accept it.
Depends on the area as well though I guess.... in major cities it might be
hard to locate near clubs becoz students will go everywhere, whereas here
they are all a walk away from eachother.

Of course your houses have broadband internet access......?
Daughter is moving into a University house in the centre of Lancaster,
next door to Sainsbury's, opposite the bus station with not only high
speed internet but direct access to the Uni's network.

Kinda hard to compete with that, except on price.

DG
 
M

mo

In Leeds we have brand new privately built tower block "Halls" with
en-suites going for £59.95. Within walking distance of Uni. Poli. and
Park Lane College.
Indeed, this is what my friend is moving into. It is privatley owned but it
is just like halls.

Easy to save £2.00/day by being able to walk.
all the student houses round here are walking distances away!

10/12 years ago our 2 eldest stayed in unbelievably squalid student lets
(decoration and fittings from the1950's). I'm sure it was a factor in
the youngest one not signing up for the 3rd year that would have turned
his HND into a degree.
Was that in Leeds as well? All the houses I have seen have been fairly
decent - although I guess the owners realise they need a standard these
days!

Daughter is moving into a University house in the centre of Lancaster,
next door to Sainsbury's, opposite the bus station with not only high
speed internet but direct access to the Uni's network.

Kinda hard to compete with that, except on price.
In my uni there are adverts EVERYWHERE advertising student accomodation, not
directly from letters but other students who need 1 or 2 extra housemates
(one of my friends has a spare room going that he and his housemates have to
pay for to keep staying in the house!) - this leads me to believe there must
be a hige surplus around here.
 
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D

Derek *

Was that in Leeds as well? All the houses I have seen have been fairly
decent - although I guess the owners realise they need a standard these
days!
Edge Lane / Kensington district of Liverpool.
In my uni there are adverts EVERYWHERE advertising student accomodation, not
directly from letters but other students who need 1 or 2 extra housemates
(one of my friends has a spare room going that he and his housemates have to
pay for to keep staying in the house!) - this leads me to believe there must
be a hige surplus around here.
Sounds like it. I still see houses being converted into student flats
around the Headingley/Beckett's Park area of Leeds with plenty of
accomodation being advertised.

DG
 
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S

strawberry

steph said:
I can't rent my student houses. I brought them all more than 8 years ago and
hardly owe the bank a penny. I paint them every 3 years, change the carpets
every 5 years and make sure they comply with all the relevent regulations.
This year I'm stuffed. Because

1. Thousands of landlords have borrowed huge amounts of money to "buy to
let"

2. These same landlords borrowed even more money in the belief that if they
do their houses up to a ridiculously high standard the other new landlords
won't do the same.

3. Thousands of students have run up such high debts that the actual amount
of debt that they end up with has no meaning other than being an abstract
figure in their heads. Meaning that when they exceed a debt of about £5000
it makes no difference to them if it goes up to £10000 or £15000. So they
quite happily borrow a pile of money and rent property (property that to
someone who has to borrow to pay the rent should be considered an
overindulgent luxery) that is way beyond their financial means.

4. Is this likely to go on indefinitly? Some people tell me its a
permananet problem. The good news for me is that quite a few people tell me
that if I hang on for a couple of years it should all sort itself out and I
might even be able to buy more houses at a knockdown price.
if you can just sit tight, there are a lot of idiots out there playing
around with houses atm, mainly due to channel 4 shows i think. my dad rents
to students in nottingham,and hes having much the same problems, in fact hes
now turned away from students to another market altogether! , in oxford
however the market is still strong, people are still commuting from miles
away or living in uni accomodation 10 miles away , or 40 mins on a clear bus
route ( one side of oxford to the other at rush hour is ridiculous)
 

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